British banking shares take a pounding

by Gill Montia

Story link: British banking shares take a pounding

Shares in UK banks fell sharply today on fears of economic uncertainty in the US.

The value of HBOS stock dipped well below the group’s rights issue price of 275p in early trading this afternoon, at 228p.

The bank is attempting to raise £4 billion from shareholders in a fundraising that closes this week.

Meanwhile, according to a report in the Telegraph, subscribers to Royal Bank of Scotland’s £12 billion rights issue, which closed last month, have now seen more than 25% wiped off the value of their investment.

Also today, Barclays shares lost 19p at 241.5p, following rumours that the China Development Bank (CDB) is withdrawing from the bank’s fundraising.

Reports in the Chinese press suggest that China’s State Council has rejected the CDB’s plan to advance £136 million for Barclays’ cash call.

Lloyds TSB shares fell in response to market sentiment and Bradford & Bingley shares were trading at 47p during the afternoon.

Later this week, shareholders in the troubled buy-to-let lender are due to vote on a £400 million rights issue at 55p a share.